More than a decade of research has established that sleep plays a critical role in memory consolidation, contributing to its stabilization, enhancement and integration into existing cortical networks. Despite the critical role of sleep in memory and cognition, abnormal sleep has generally been overlooked as a potential contributor to cognitive deficits in schizophrenia (SZ). This oversight is important as effective treatments for cognitive deficits are lacking and abnormal sleep is a potential treatment target. A burgeoning literature suggests that sleep spindles mediate sleep-dependent memory consolidation and cognitive function more generally. At the same time, several recent studies show that sleep spindles are dramatically reduced in SZ. Our preliminary data are the first to link the sleep spindle deficit wih the impairment of sleep-dependent memory consolidation in SZ that we have now documented in four independent studies. They also provide the first demonstration of reduced coherence of spindles across the cortex. Reduced spindle activity also predicted increased severity of positive symptoms and neurocognitive deficits. The observed spindle abnormalities implicate dysfunction in the spindle-generating thalamocortical feedback loop, which is regulated by both -aminobutyric acid (GABA)ergic and N-methyl-D-aspartate acid (NMDA) receptor mediated glutamatergic neurotransmission, all of which have been implicated in the pathophysiology of SZ. The primary goal of the proposed study is to replicate and extend the findings of our placebo-controlled, double-blind pilot study that eszopiclone (Lunesta), restores sleep spindles and sleep-dependent consolidation of motor procedural memory in SZ to normal levels. Eszopiclone is a non-benzodiazepine hypnotic agent that acts on GABAA receptors in the thalamic reticular nucleus where sleep spindles are generated. We will also determine whether there is more general impairment of sleep-dependent memory in SZ by examining the consolidation of other types of memory that are known to be impaired. Finally, we will establish the clinical relevance of abnormal sleep in SZ by correlating spindle activity and other sleep parameters with cognitive deficits based on standard neuropsychological assessment, symptom presentation, and functional capacity. In summary, our preliminary data suggest that abnormal spindles impair sleep-dependent memory consolidation in schizophrenia, contribute to positive symptoms, and are a promising novel target for the treatment of cognitive deficits in schizophrenia. This project is novel and both clinically and scientifically significant in that if ur hypotheses are confirmed, it will link a specific cognitive deficit to a particular mechanism and provide an effective intervention. Thus, the proposed research program has the potential to substantially expand current models of cognitive deficits in SZ and to lead to interventions that significantly improve the quality of life of individuals with SZ.